USEC posts loss

4 August 2005

Uranium enrichment company USEC has reported a second quarter net loss of $3 million, or ¢3 per share, compared with a profit of $7.4 million, or ¢9 per share, a year earlier.

For the six months ended 30 June 2005, USEC reported a net loss of $2.1 million compared to a net loss of $2.4 million in the same period last year.

The company cited demonstration costs for the American Centrifuge, which have more than doubled to $45.6 million during the six-month period. The higher costs are a result of an increase in the number of employees and contractors working on demonstration activities, increased spending to manufacture centrifuge components for the lead cascade, and costs to upgrade equipment at the American Centrifuge facility in Piketon, Ohio.

USEC is working to resolve issues that have arisen in the testing programme related to materials and centrifuge components, as well as recently issued regulatory requirements. This has delayed operation of the American Centrifuge Demonstration Facility until the first half of 2006.

The company anticipates 2005 annual net income in the range of $20-25 million, even after higher American Centrifuge expenses.

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